Wa/1579/2023 Of The Deputy Commissioner Of Income Tax v. M/S Deutsche Telekom Ag

Digitallysigned by A KCHANDRIKALocation:HIGH COURTOFKARNATAKA NC: 2024:KHC:10968-DB WA No. 1579 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18 DAY OF MARCH, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA -WRIT APPEAL NO. 1579 OF 2023 (TIT) BETWEEN: THE DEPUTY COMMISSIONER OF INCOME TAX INTERNATIONAL TAXATION, CIRCLE-2(1), BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU - 560 095 …APPELLANT (BY SRI. Y.V.RAVIRAJ ADVOCATE A/W SRI.M.DILIP., ADVOCATES) AND: M/S DEUTSCHE TELEKOM A G FRIEDRICH-EBERT-ALLE 140, 53113 BONN, GERMANY, (REP BY ITS HEAD OF TRANSACTION TAX SRI ULRICH HARTMANN S/O SRI WERNER HARTMANN AGED ABOUT 62 YEARS …RESPONDENT (BY SRI.K.K.CHYTHANYA SR. COUNSEL FOR SRI.S.SHARATH., ADVOCATE) THISWRIT APPEAL IS FILED U/S 4 OF THE KARNATAKA HIGH COURT ACT PRAYING TO A)SET ASIDE THE ORDER PASSED BY THE LEARNED SINGLE JUDGE IN WP NO.53137/2018 DATED 23/08/2023 & ETC. THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, S.G.PANDIT J.,DELIVERED THE FOLLOWING: JUDGMENT Heard Sri. Y.V.Raviraj along with Sri. Dilip.M., learned counsel for the appellant and Sri. Chythanya.K.K., learned Senior Counsel for Sri. S.Sharath, learned counsel for the respondent. 2. Perused the appeal papers. 3. The question involved in the appeal is as to whether interconnect service charges paid would amount to royalty. 4. The above issue was considered by a Co-ordinate Bench of this court in ITA.No.160/2015 and connected appeals. By judgment dated 14.07.2023, it is held that interconnect service charges would not constitute royalty. Paragraph No.21 of the judgment reads as follows: “The third question is, whether the payments made to NTOS for providing interconnect services and transfer of capacity in foreign countries is chargeable to tax as royalty. It was argued by Shri.Pardiwala, that for subsequent years in assessee’s own case, the ITAT has held that tax is not deductable when payment is made to non-resident telecom operator. This factual aspect is not refuted. Thus the Revenue has reviewed its earlier stand for the subsequent assessment years placing reliance on Viacom etc[35], rendered by the ITAT. In that view of the matter this question also needs to be answered against the Revenue.” 5. Learned Single Judge has also placed reliance on the above decision of the Co-ordinate Bench. Therefore, we do not find any infirmity in the orders under challenge. 6. Following the decision of Co-ordinate Bench dated 14.07.2023 in ITA No.160/2015 and connected appeals, the above appeal stands dismissed. Sd/- JUDGE Sd/- JUDGE